economics of policy issues - Essay Example

Extract of sampleeconomics of policy issues

As a result these traffic congestions occur more frequently as the trouble makers (those who do not follow the traffic rules) do not take into account the problems that others stuck in this jam would face. If they are aware of the fact that other people would suffer because of the jam that has been created due to their negligence, they would avoid doing it. Since then they will realize that gains such as (reaching the office or school) would be less as compared to the harmful effects of the jams such as accidents, tension, chaos and other problems that traffic jam creates.
Economists usually explain this theory using a diagram. This diagram says that if people are aware that they cause externalities with their action, they will do less of these actions which create externalities.
Suppose, that a person want to break a traffic rules for one reason or another. Before making the decision he'll only look at his external costs (such as fines, traffic tickets etc.) and his private benefits (such as reaching destination early etc). In such a case his private cost curve will also be his supply curve and his private benefits curve will be his demand curve. The equilibrium in this case will occur at point where demand is equal to supply or in other words where private costs are equal to private benefits. ...Show more

Summary

Externality of an economic transaction is an impact on a party that is not directly involved in the transaction. In such a case, prices do not reflect the full costs or benefits in production or consumption of a product or service. Externalities are often negative effects created by a party who has taken an action over those are not involved in this action…

Related Essays

Even after the world has crossed the threshold of twenty first century with numerous advancements in various sectors, yet the social distress is a concern on a continuous basis. However, the nations of the world are working and developing rules, regulations, and guidelines that can serve the welfare of the denizens of the society so that the communities are in a much better position to succeed and become prosperous.

The notion of globalization significantly confronts with the issues related to technology, market, demands for up-surging growth and productivity in the economic context nationally as well as globally. The term has gained much significance in recent times, which was initiated during the end part of the Middle Ages in the continent of Europe (Sheel, 2013).

Since times immemorial social policies existed globally .The policies transcend with Time . Social policies vary from time to time, country to country, state to state. Different Countries have different social policies according to their needs and conveniences.

As such, states had invested themselves the role of " protector, keeper, nourisher and master" (Botsford 2001,p.19).
One country which kept on tight rein for centuries its pater familias tradition is Japan. In Japanese history, the ruling Mikado as pater familias, invested with patria potestas, "invariably assumed the patriarchal attitude of guardianship towards the people" (Uyehara 2008, p.22).

Economics is a discipline that examines reasoned decision making with limited resources. It is a social science concerned with the behavior of individuals and institutions engaged in the production, exchange and consumption of goods and services. Economics study provides solutions to resolve the conflicts between unlimited desires for higher living standards and limited resources to satisfy these desires.

A comment on a website surveying for a solution to this problem appeared as, "In many countries (but especially Britain) the entire philosophy concerning public transport is flawed. First, it should be more convenient and, second, it should be cheaper, than the alternative single-person, single-car option.

Participant observation research is descriptive and often exploratory” (Macionis, 2011, p. 7). The participant observation process that was therefore delved into by Smith complied with the research method as presented by

The author states that LCAO see the need to reduce the nation’s deficit but proposes and thus proposes a savings mechanism to counter the vast health care inflation. The argument is that the increase in Medicare eligibility age does not meet the required standards because it aims towards increasing the health spending.